A potential homebuyer is sitting at a blackjack table. He hasn’t raised his bet, but instead, places a contingency. The dealer proclaims, “winner, winner, chicken dinner!”
While selling and buying a home doesn’t exactly happen in a casino – you get the idea.
Redfin has pronounced that around 7% of winning offers last month were contingent on the sale of the buyer’s home – which is up from less than 5% last year.
A sale contingency allows the buyer to coordinate the timing of the sale of their previous home with the purchase of their new home – which means that buyers are moving because they want to, not necessarily because they need to.
Experts agree that this rise in sale contingencies equals a more balanced market between buyers and sellers, since buyers are facing less competition. Because there are less bidding wars, sellers are more willing to negotiate and work with a buyer who is relying on a sale contingency.
Redfin believes this change is good for the market, as hesitant buyers last year might reappear.
While spring hasn’t quite yet sprung for the real estate world, it looks like signs are pointing towards a balanced market.